Heathrow pre-tax profit surges as it prepares for expansion

Heathrow posted its results for the 2016 calendar year on Friday, with revenue rising 1.5% to £2.81bn and adjusted EBITDA improving 4.8% to £1.68bn.

The private consortium-held airport operator generated £1.65bn cash from operations, a rise of 3.8%, while cash flow after investment and interest was up 7.2% to £387m.

It reported a pre-tax profit of £267m, surging 19.7% year-on-year.

On the debt side, consolidated net debt at Heathrow (SP) Ltd rose 1.4% during the year to £11.91bn, while it increased 2.6% at Heathrow Finance plc to £13bn.

The group’s regulatory asset base was up 2.1% at year-end, at £15.24bn.

Passenger numbers increased moderately, rising 1% to 75.7 million in 2016, though the company increased the retail revenue per passenger by 6.7% to £8.09.

It also reported a 3.0% increase in cargo volumes.

“2016 was a milestone year for Heathrow,” said chief executive John Holland-Kaye.

“I am very proud of what our 76,000 colleagues have achieved.

“We gave better service at lower cost to a record number of passengers and helped British businesses across the country trade more with the rest of the world.”

After the announcement of the Government’s preference to support expansion at Heathrow over Gatwick, Holland-Kaye said the company had started the planning process and was preparing the skills and the supply chain needed to build a third runway and associated infrastructure and facilities sustainably and affordably.

“Heathrow is delivering for Britain.”